Karnataka

Bidar

CC/76/2014

MEERA W/O LATE ASHOK KUMAR JOSHI - Complainant(s)

Versus

THE BRANCH MANAGER LIC OF INDIA B,KALYAN - Opp.Party(s)

P M DESHPANDE

24 Dec 2016

ORDER

::BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

AT BIDAR::

 

 

                                                                                                                C.C.No. 76/2014.

 

                                                                                                  Date of filing : 06/09/2014.

 

                                                                                             Date of disposal : 24/12/2016.

 

 

P R E S E N T:-                    (1) Shri. Jagannath Prasad Udgata,

                                                                                         B.A., LL.B.,

                                                                                                       President.

    

                                              (2) Shri. Shankrappa (Halipurgi),

                                                                                 B.A.LL.B.,

                                                                                           Member.

 

                                   

 

                                               

COMPLAINANT/S:              Smt. Meera W/o Late Ashok Kumar Joshi,                                                   Age 34 years: Occ: Household,

                                            R/o H.No.8-3-33 Saraswati Godam

                                         Super Market Gulbarga-585103.

 

              

 

 

                                         (By Shri. Deshpande P.M., Advocate )

 

 

                                                      VERSUS

 

OPPONENT/S   :-                   The Branch Manager, L.I.C. of India,

                                              Narayanpur road, Basavakalyan

                                              Dist. Bidar.

                                       

                                         

 

 

                                      (O.Ps By Shri.S.R.Sangamkar, Advocate)   

 

 

                                                

::   J UD G M E N T  : :

 

 

 

By Shri. Jagannath Prasad Udgata, President.

 

              The present complainant, a widow is before this forum filing complaint u/s 12 of the Consumer Protection Act, 1986 against the opponent corporation alleging deficiency of service and unethical trade practice.  The sum total of her complaint is as here under.

 

 

2.             That, her late husband Ashok Kumar was a commission agent under the O.P. corporation and during his life time had procured three policies as described underneath.

 

Sl.No.	Policy No.	Sum Assured	Date of Commencement	Monthly Premium.
1.	661214050	1,00,000/-	28.02.1996	Rs.90/-
2.	661345740	2,00,000/-	21.02.2002	Rs.218/-
3.	661655544	1,50,000/-	28.00.2011	Rs.843/-

 

 

 3.           All the policies above quoted were under salary saving scheme and the corporation was absorbing the monthly premiums deducting the same from the commission earned.  The complainant was the nominee in respect of all three policies. 

 

4.          That, when the matter stood as such, the late policy holder died untimely on 23.08.2012, and as nominee, she raised the claims for settlement.

 

5.                     That, the L.I.C. while remitted the paid up value for the first two policies, did not settle the claim for the third policy, claiming non- payment of regular premiums in respect of the all three policies.  The complainant even had approached the insurance ombudsman, but still the representation remained unanswered and hence she is before this court to assuage her grievances.

 

6.         The O.P. corporation has put up appearance on receipt of court notice and has filed versions, in which it is claimed that, in respect of the policies stated supra, the premiums had remained unpaid a follows:-

 

Sl.No.	Policy No.	Plan/Table	Gaps in premiums.
1.	661214050	Bimakiran/111	06/1996, 07/1996, 08/1996 06/2012.
2.	661345740	Bimakiran/111	06/2012.
3.	661655544	Jeevan Mitra/Trible cover.	06/2012.

 

 

7.         Hence, the O.P. corporation claims that, they were justified in paying the paid up value for first two and repudiating claim in respect of third policy, and they have intimated as such to the complainant vide a letter date: 19.10.2013.  Both sides have filed their respective evidence affidavits and written arguments, so also documents listed at the end of this order.

 

8.         The complainants’ side had relied on two rulings as detailed below, in which the Hon’ble National Commission and Punjab State Commission have held as described underneath:-

 

            1.         2015 NCJ 466(N.C)

                        L.I.C. of India V/s Smt. Ramsakhi.

            Salary Saving Scheme- question of lapsed policy-Scope-Held-Question of lapse of a policy under “salary saving scheme” arises only when premiums remain unpaid for 6months and intimation on that behalf was required to be sent in prescribed form by insurance company to the employee as well as insured and it has been further held by Hon’ble National Commission. 

            13. Answer to the second question also need not detain me for long.  Here again only paragraphs 13.4 and 16 of the Manual for Policy Servicing Department (No.14) issued by the Insurance Company itself, for administering the Salary Saving Scheme need to be interpreted.  The said paragraphs read as follows:-

            “13.4 LOSS OF PAY: Default in payment of premia should be intimated to the party and arrears of premia should be called for.   If the number of premiums unpaid are 6, lapse action should be taken.

            14.............

            15.............

            16. DEFAULT AND FINAL LAPSE NOTICE:

            While posting the Group Ledger and default in payment of premia should be communicated to the employer on a special form No.5227.  If the premiums remain unpaid for 6moths, a lapse intimation on the prescribed form No.5228 should be sent to the employee.  A lapse Register is also to be maintained for preparing statistics in respect of lapses.

            2.         III(2009) CPJ 140 (Punjab State Commission)

                        L.I.C. of India v/s Mam chand and Another.

            Consumer Protection Act,1986 Section 2(1)(g) Life Insurance Policy lapsed Premium not paid Policy obtained through agent No contract exists between employer and insurer Since insurer assumed liability of writing to employer of assured to deduct premium amount from assured’s salary, remit it to them Insurer liable to pursue matter with employer Premium of not paid by employer, insurer liable to inform assured about non-receipt of premium from employer Deficiency in service on part of insurer proved, which led to lapsing of policy Complaint allowed by Forum Order upheld in appeal.

 

9.         Considering the rival claims of the feuding parties, the following points arise for our consideration.

 

1. Has the O.P. corporation resorted to deficiency of service/ unethical trade practice?
2. What orders?

            Our answers to the points:-

               1. In the affirmative.

               2. As per final orders owing to following:

 

 

                                                                                                       :: REASONS ::

 

10.       It mighty intrigues us as to how the O.P. corporation at all got admitted a commission agent under the salary saving scheme, knowing fully well that, his income per month would be erratic/irregular.  However, well aware of the intricacies, the O.P. corporation had indulged in issuing the policy (s), assuming the responsibility unto itself to deduct the premiums from the commission(S) earned by the insured.  The corporation itself was the Drawing and Disbursing agency of the entitlements of the incumbent insured and it was the corporations’ responsibility itself to collect and absorb the required premiums from the commissions earned by the insured.  If at all, there was instances of non-earning of commissions, in a particular month or months, the corporation, when could collect the premiums of the running month/ months was under obligation to collect the premiums of the preceding month/months as well. But alas, the corporation has miserably failed to fulfil the responsibility assumed by itself.  Even otherwise, it was incumbent upon the corporation to serve an effective notice on their protégé, demanding the payment of premium, but it has not been complied.  The rulings of the National Commission and Punjab State Commission quoted Supra, chinches the issue and the misfeasance of the O.P. corporation cannot be planted at the door step of the insured.

Therefore, we are constrained to pass the following:-

:: ORDER ::

 

   

1.  The complaint is allowed in part.
2. The O.P. corporation is hereby directed to remit the entire proceeds of insured amount, together with the bonus and all other benefits accrued to the three policies obtained by the complainants’ late husband without demur together with interest @ 12% p.a. on the sum assured in all three policies calculated from the date of filing of the complaint i.e., 06.09.2014 till the date of realisation.
3. The payment already done in respect of first two policies under the head of paid up value are to be given a set off.
4. The opponent to pay a sum of Rs.10,000/- towards compensation for the mental agonies and inconveniences under gone by the complainant together with litigation expenses in a further sum of Rs.10,000/-

 

 

           d)  Four weeks time granted to comply this order.

 

(Typed to our dictation then corrected, signed by us and then pronounced in the open Forum on this 24^th day of December-2016)

 

 

 

 

 

              Sd/-                                                                           sd/-    

Sri. Shankrappa H.,                                             Sri. Jagannath Prasad,                                  

       Member.                                                                      President.     

 

 

                                                                         

 

 

Documents produced by the complainant

1. Ex.P.1- Status report of Policy No.661214050.
2. Ex.P.2- Status report of Policy No.661345740.
3. Ex.P.3- Status report of Policy NO.661655544
4. Ex.P.4 – Intimation of Paid up value in respect of Policy No.661214050.
5. Ex.P.5- Intimation of Paid up value in respect of Policy No.661345740.
6. Ex.P.6- Repudiation letter in respect of Policy No.661655544.
7. Ex.P.7- Certificate of commission earned in Form No.16A.
8. Ex.P.8- Certificate of commission earned in Form No.16A.
9. Ex.P.9- Copy of Voter I.D. Card of complainant.
10. Ex.P.10- Office copy of legal notice date: 14.09.2013.
11. Ex.P.11-Reply to legal notice date: 19.10.2013.
12. Ex.P.12- Copy of legal notice to Insurance ombudsman date: 20.08.2014.

    (Office to demand death certificate to be listed as Ex.P.13)

 

 Document produced by the Opponent/s

 

1. Ex.R.1- bond of Policy No.661345740.
2. Ex.R.2- Bond of Policy No.661655544.

 

 

 

              Sd/-                                                                            sd/-    

Sri. Shankrappa H.,                                             Sri. Jagannath Prasad,                                  

       Member.                                                                      President.

 

Sb.